Burnout, Anxiety and Emptiness: Founders Open Up About the Dark Side of Entrepreneurship

February 2002 was a difficult time for most New Yorkers. The city was reeling from the attacks of September 11th. The cleanup effort was still underway.

Jerry Colonna felt the weight of the tragedy every day. One morning, after leaving a meeting in the financial district, he decided he couldn’t do it anymore. Not the job, not any of it. “I stepped outside the office and stood in front of Ground Zero and wanted to kill myself,” he says.

He called his therapist and told her he was going to jump in front of a train. She convinced him to come to her office instead.

Thirty-eight at the time, Colonna had found early success as a venture capitalist. Along with Fred Wilson, he launched Flatiron Partners in 1996, one of New York City’s first VC firms. It was a success until, following the dotcom crash, it wasn’t. When the firm shut down, Colonna took a job at JP Morgan Partners. Just before September 11, Colonna was struggling emotionally and professionally. After the attacks, he was a mess. “I was filling my calendar because I couldn’t bear the loneliness and emptiness, and then canceling them because I couldn’t bear to go,” he says.

Following that morning in February, Colonna got off the traditional startup/VC career ladder — for good. He’s still an entrepreneur, but his venture, Reboot.io, which he started in 2014, is devoted to helping founders and C-suite executives manage the stress, anxiety, burnout and other byproducts that come with a demanding job.

He says he doesn’t regret the decision — it’s allowed him to live a healthy, honest and meaningful life. At the same time, Colonna is far less professionally successful than his former partner Fred Wilson, who went on to launch Union Square Ventures and is now a bonafide VC guru. As Colonna joked onstage at a tech conference in Brooklyn this summer, “New York Magazine had called Fred and I the ‘princes of New York.’ He’s now a f**king king, and I’m a court jester.”

He understands that many entrepreneurs aren’t willing to make the same trade, which means they need to act the part. Particularly in the tech enclaves like Silicon Valley and New York City, confidence is currency and admitting uncertainty or fear quickly drains the bank.

And yet, over the past few years, a counter narrative has emerged. High-profile venture capitalists and entrepreneurs, including venture capitalist Brad Feld, Moz’s Rand Fishkin and Y Combinator president Sam Altman, have declared that no, they don’t always feel like they’re “crushing it,” and yes, they have (or know entrepreneurs who have) experienced feelings of intense doubt and darkness

It’s a trend that’s opened the door for more honest discussions about the emotional toil of pouring everything into a company that, statistically, won’t make it. But as with the failure narrative, certain types of depression stories are more palatable than others. To the press and public, founders who have yet to reach Feld-level notoriety often portray their depression as a contained arc. Burnout, anxiety and even clinical sadness are painful but ultimately surmountable bumps on the road to eventual success.

Here’s a classic example, courtesy of a 2013 Inc. article, which describes how the owner of a management consulting firm fell into a crippling depression when, following the financial crisis, he had to lay off employees. He withdrew from his family and stopped leaving the house. And yet, somehow “through it all, he kept working to develop new services.” At the article’s close, he is no longer depressed and his company “scored its biggest-ever contract.” Sales are up 5,000%.

There are a lot of accounts like this, which doesn’t surprise Colonna. “We love stories of redemption,” he says. “No one wants to talk about the fact that the black hole never really goes away.” But for many of the founders and executives he’s worked with, depression isn’t a story’s second act. Instead, it can strike at anytime and contribute to a startup’s failure, or spawn from its collapse.

“In a lot of stories you read, it regresses back to happy talk at the end — there was a problem, we solved it and now it’s all fixed,” says Michael Freeman, a psychiatrist who is studying the personality traits of entrepreneurs at University of California, San Francisco. “But that’s not the case with mental health issues,” including depression, which he believes affects entrepreneurs at a higher rate than the general population. That’s likely partially due to personality type, partially because the entire proposition is built on outsized risk — according to a frequently cited Harvard Business School study, nine out of 10 startups fail. More than 50% of U.S. startups don’t make it past the five–year mark, and most that do aren’t flashy, billion–dollar success stories, but companies fighting to keep the lights on. Pouring everything you have into a venture that goes belly up understandably hurts.

Below two entrepreneurs, friends living in Boulder who are at different stages in the startup cycle — one is working at another company after his own venture failed, and the other is trying to raise a new round of funding for his business — share their experiences with depression.

“If this business was a failure, does that mean I’m a failure?”

Before Taylor McLemore, 31, started his own company in 2010, he’d never experienced anything close to depression. And in the beginning, when it was nothing but shiny expectations and $500,000 in seed funding, the future looked bright. The workload was heavy but as the company’s co-founder, McLemore hadn’t just drunk the Kool Aid — he’d mixed it himself.

But then came the setbacks. After failing to gain enough traction as a social gaming network, his startup pivoted to become a Facebook-based fantasy sports company. At the end of 2013, shortly after joining the startup accelerator Techstars in Boulder, one of its largest clients failed to make a payment and the startup ran out of capital.

Along with his co-founder, McLemore had to shut the company down, which meant letting go of a handful of employees and telling early backers their investment was effectively worthless. That’s when the emotional anguish set in. “If this business was a failure, does that mean I’m a failure?” he remembers thinking. The question wouldn’t leave him alone. For months getting out of bed, much less leaving his house, took enormous effort. In looping cycles, pernicious thoughts dissecting each one of his many inadequacies ran through his brain; once pleasurable social activities became painful ordeals, in large part because everyone else seemed to be doing so well.

On an intellectual level, he knew many of his friends in Boulder’s tight-knit entrepreneurial community weren’t “crushing it.” But engaging in feigned, projected confidence even when things fall to pieces is “the lowest risk move,” says McLemore. Entrepreneurs are at war for cash, talent, exposure — confidence is a defense mechanism, which meant most acquaintances projected only sunny optimism.

Only after months of persistent outreach, from his wife, friends and professional connections, was he able to seek out new career opportunities.

In early 2014, he began consulting for an early stage startup that invests in technology companies. Today, he’s the director of business operations, which means he gets a paycheck and no longer has to worry about making money for investors or raising enough capital to pay his employees.

When asked if he would trade this relative stability to try it all again, he pauses for a long time. His answer, ultimately, is yes. The statistics haven’t changed — his second attempt would likely fail, and he doesn’t think the feelings of shame, defeat and disappoint will be easier to handle the second time around. It sounds masochistic, but really it’s just that starting a business is a game of mental jujitsu. “That’s the paradox of being an entrepreneur,” he says. You need be informed about the industry’s mortality rate and then “you have to expel that disbelief to start something.” Otherwise, McLemore says, what’s the point? In the race to merge these outsized expectations with reality, you conflate your own identity with that of your company’s, which is at once the best motivator and a recipe for emotional disaster.

Still, next time around he says he’ll do things differently. Most importantly, he’ll reach out to friends earlier. They may not advertise it, but most have their own experience with failure and basement-level self-confidence. Commiserating helps.

His advice: Lean on your support system and reach out to other entrepreneurs in your community — many of them have likely experienced similar emotions.

“When you are out raising money, people are counting on you. But there are no guarantees you’ll have a business a year from now.”

David Mandell, 49, has always been a pretty melancholy guy. “It’s been my whole life. We all have a set point — some people’s set points are on the happy side, some people’s set points are on the not as happy side. My set point is edged towards the depression side,” he says. But while he had moody tendencies from high school onwards, it typically registered as introspection and introversion.

When he left his first business on not-so-great terms, that changed. After two years — and just as many pivots — Mandell no longer believed in the company he’d co-founded. In large part, this was due to board-incited whiplash (the startup began as a social media platform, rebranded as a real-time search engine, and finally morphed into a real-time ad exchange platform). Employee count had blossomed, but Mandell hated what the culture had become. “It wasn’t friendly,” he says. “There was a lot of just ‘shut up and do it.’ The good people were leaving because they were unhappy, and the bad people were staying because they didn’t care.”

And so in the fall of 2008, he left. It was a dark time. His inability to stop his startup from turning into something he wasn’t proud of made him feel like a complete failure. An ugly mantra ran through his head on repeat: “I had raised a bunch of money from people and they aren’t going to have any faith in my any more. I hired a bunch of good people and they’ll never work with me again. I have a family and I don’t know how I’m going to make money.”

His initial recourse was to retreat. He didn’t want to socialize. He didn’t even want to leave the house. The sense of failure was all-encompassing. “My wife was not happy with me,” Mandell says. “There were a lot of ‘what the hell are we doing to do now’ conversations.”

He didn’t shake the claustrophobic self-image until David Cohen, whom he’d met when they both were mentors at Techstars, asked if he’d be an advisor to one of the the startups cycling through the accelerator program. The request was the lifeline he needed; while it didn’t feel like it, his experience and skills were worth something. It was enough to get him out of the house. He started to feel better.

In 2011, after speaking to a friend who had rented space for his company but had yet to grow enough to fill it, Mandell had an idea. That revelation would become PivotDesk, which enables startups with extra square footage to rent out space to freelancers and smaller companies. Unlike WeWork it doesn’t own any property, but manages the headache of facilitating short-term leases.

The company is now in 30 markets, including San Francisco, New York City, and Boston. To date, it’s raised nearly $7 million. But PivotDesk is running out of cash; Mandell is in the process of closing a new round of funding. He’s bullish on the company’s prospects — “I think we’ve seen a big shift in the industry…the willingness to try and accept what we’re doing as a real solution is more significant now,” he says — but also recognizes that a startup is never a sure thing. When employees approach him with concerns about the future, he’s transparent: he’s hopeful, but can’t make any promises.

What if the startup fails? At first, he says he’ll be better equipped to handle the fallout this time. But unprovoked, he runs through a list of concerns: He can’t let PivotDesk fail because, “I can’t let these people down, I can’t let my employees down, I can’t let my investors down, I can’t let my customers down.” It sounds eerily familiar.

If things do fall apart, he says he’ll try to internalize the advice he tells other entrepreneurs: “You didn’t fail, your business didn’t succeed. You started something from nothing, took a risk few people ever take, and learned a lot.” Since his bout with depression, he has become something of a mentor to a network of founders, and ‘your value is not the same as your company’s’ is a line of logic he employs often.

But realistically, he knows it it would crush him. When a company fails, “there’s no way to brush that off,” he says. “It’s a mourning process.”

His advice: Don’t run from your emotions, but remind yourself that failing at a business is different from failing at life. “You are valuable, you have a lot to offer, who knows what you will do next, but you’ll do something good” are things he doesn’t think struggling entrepreneurs hear enough.

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